Dealers Resent Snub By Apple At iPhone Launch

As leading consumer electronics retailers find themselves excluded from the launch of one of the most anticipated CE products in recent memory, namely, the Apple iPhone, several have a message for Steve Jobs — "Why not us?"

Many say that their customers are already asking for the iPhone, unaware that the product launched exclusively through Apple's stores and AT&T's nearly 1,800 stores (formerly Cingular stores) and AT&T's direct-mail operations.

The snub by Apple is even more painful for CE dealers who also sell AT&T cellular phones.

J&R Music World, New York, a long-time Apple dealer, said, "This is a product J&R is interested in as both an Apple and AT&T dealer. We think we can do a good job with it. Our customers have expressed a great deal of interest in the product," noted a spokesman.

Datavision, New York, said it sells 5,000 MP3 players a month and its customers are asking for the iPhone. The store said it could sell 2,000 or more units at launch if it were given full inventory.

Many of the leading CE dealers built reputations on being the first to stock and demonstrate new technology and some wondered why select CE dealers, particularly those who are also AT&T dealers, were not included in the launch.

"We're the guys that sell the 103-inch Plasma TV from Panasonic. We were one of the first retailers to carry Sonos. We have the know-how and customer base to sell the iPhone," said Tom Galanis, merchandising VP for 6th Avenue Electronics, Springfield, N.J. He added, "A cellphone store is a cellphone store. My feeling is they are shooting themselves in the foot … Apple would be better served by picking a few higher-end retailers that have a track record of selling high-end technology."

Amazon.com also noted that its strength is in selling to customers seeking the bleeding edge. "Amazon has eager, early-adopter customers who are very interested in new technology. And we've seen through many of the high-end electronics we've introduced over the years, including cameras and MP3 players, that our customers are very interested in new products and trends," said Noah Hershman, audio/video director.

Galanis said customers with home networks would like to work through the store to add the iPhone. "We sell elaborate home networks and people view their homes or their kids with the babysitter when they are out to dinner. Because of the iPhone's large screen, it works fine with that application, and our customers want to put it on the network."

He called the iPhone "an incredible piece of equipment."

Leading CE retailers said they are repeatedly calling their Apple contacts only to be told that there is no time frame for opening distribution to traditional retailers. Only one retailer said he was told distribution would open in six months.

Apple did not respond to a TWICE inquiry.

The iPhone is a $499 to $599 smartphone/iPod that has no keypad but uses a touch-sensitive screen. It allows Web browsing including Google, Yahoo! and YouTube searches. Users can read Web pages while downloading email in the background over Wi-Fi or EDGE. The iPhone also provides access to information such as traffic and map directions.